Substitute Senate Bill No. 1148
         Substitute Senate Bill No. 1148

              PUBLIC ACT NO. 97-179


AN  ACT  CONCERNING   FARM,  FORESTRY  AND  GARDEN
EQUIPMENT DEALERS AND  SUPPLIERS  AND "PICK OR CUT
YOUR OWN" AGRICULTURAL OPERATIONS.


    Be  it  enacted  by  the  Senate  and House of
Representatives in General Assembly convened:
    Section  1.  (NEW) As used in this act, unless
the context otherwise requires:
    (1)   "Current  net  price"  means  the  price
listed in a supplier's price list  or  catalog  in
effect   at   the   time  a  dealer  agreement  is
terminated, less any applicable discounts allowed.
    (2)   "Dealer"   means   a   person,  firm  or
corporation primarily engaged in the  business  of
retail   sales   of  farm  and  utility  tractors,
forestry   equipment,    light    industrial    or
construction   equipment,  farm  implements,  farm
machinery,   yard   and   garden   equipment,   or
attachments,  accessories or repair parts for such
items, but does not include a single  line  dealer
primarily  engaged  in the retail sale and service
of   industrial,   forestry    and    construction
equipment.   For  purposes  of  this  subdivision,
"single line  dealer"  means  a  person,  firm  or
corporation  that:  (A) Has purchased seventy-five
per cent or  more  of  such  person's,  firm's  or
corporation's  total  new product inventory from a
single  supplier;  and  (B)  has  a  total  annual
average  sales volume for the previous three years
in excess of twenty million dollars for the entire
territory   for   which   such   person,  firm  or
corporation is responsible.
    (3)  "Dealer  agreement"  means  a  written or
oral contract between  a  dealer  and  a  supplier
entered into on or after January 1, 1998, by which
the  dealer  is  granted  the  right  to  sell  or
distribute  goods  or  services  or to use a trade
name, trademark, service mark, logotype, or  other
advertising or commercial symbol.
    (4)   "Inventory"   means   farm  and  utility
tractors, forestry equipment, light industrial  or
construction   equipment,  farm  implements,  farm
machinery,  yard   and   garden   equipment,   and
attachments, accessories and repair parts for such
items.
    (5)  "Net  cost" means the price a dealer paid
a supplier  for  inventory,  less  any  applicable
discounts allowed, plus any amount the dealer paid
for freight costs from the supplier's location  to
the   dealer's  location.  In  the  event  of  the
termination of a dealer agreement by the supplier,
"net   cost"   includes  the  reasonable  cost  of
assembly or disassembly, or both, performed by the
dealer.
    (6)    "Supplier"    means    a    wholesaler,
manufacturer  or  distributor  of  inventory   who
enters into a dealer agreement with a dealer.
    (7)  "Termination"  or  "terminate"  means the
cancellation, nonrenewal or  discontinuance  of  a
dealer agreement.
    Sec.   2.   (NEW)   (a)   Notwithstanding  any
contrary provision of any agreement  entered  into
on   or  after  January  1,  1998,  prior  to  the
termination of  a  dealer  agreement,  a  supplier
shall  notify  the  dealer of such termination not
less than one hundred twenty  days  prior  to  the
effective  date  of  such termination. No supplier
may terminate a dealer  agreement  without  cause.
For  purposes of this subsection "cause" means the
failure  of  a   dealer   to   comply   with   any
requirements  imposed  upon the dealer by a dealer
agreement,  provided  such  requirements  are  not
substantially  different from requirements imposed
by agreement upon other similarly situated dealers
in this state in the normal course of business.
    (b)  A  supplier  may  immediately terminate a
dealer agreement at any time upon  the  occurrence
of any of the following events:
    (1)  The  filing  of a petition for bankruptcy
or for  receivership  either  by  or  against  the
dealer;
    (2)  The  making by the dealer to the supplier
of an intentional and  material  misrepresentation
as to the dealer's financial status;
    (3)  Any default by the dealer under a chattel
mortgage or other security agreement  between  the
dealer and the supplier;
    (4)   The   commencement   of   voluntary   or
involuntary  dissolution  or  liquidation  of  the
dealer   if   the   dealer  is  a  partnership  or
corporation;
    (5)  A  change in the location of the dealer's
principal place of business as set  forth  in  the
dealer   agreement   without   the  prior  written
approval of  the  supplier,  if  required  by  the
dealer agreement; or
    (6)  Withdrawal  of  an individual proprietor,
partner or major shareholder of  the  dealer,  the
involuntary  termination  of  a key manager of the
dealer, or a substantial reduction in the interest
of  a  partner  or major shareholder of the dealer
without the prior written consent of the supplier,
if required by the dealer agreement.
    (c)  Unless  there  is  an  agreement  to  the
contrary, a dealer that  intends  to  terminate  a
dealer  agreement with a supplier shall notify the
supplier of such intent not less than one  hundred
twenty  days  prior  to  the effective date of the
termination.
    (d)  Any  notice  required  to  be given under
this section by either party to a dealer agreement
shall  be  in  writing, shall be made by certified
mail or by personal delivery and shall contain, at
a minimum:
    (1)  A statement of intention to terminate the
dealer agreement;
    (2)  A  statement  of  the  reasons  for  such
termination; and
    (3)  The  date on which such termination shall
become effective.
    Sec.  3.  (NEW)  (a)  Whenever a dealer enters
into a dealer agreement  under  which  the  dealer
agrees  to  maintain  an inventory and such dealer
agreement  is  terminated  by  either   party   as
provided  in  section 2 of this act, the supplier,
upon written request of the dealer filed not later
than  thirty days after the effective date of such
termination,   shall   repurchase   the   dealer's
inventory  as provided in this section and section
4  of  this  act,  except,  there  shall   be   no
requirement   for   the   supplier  to  repurchase
inventory pursuant to this section and  section  4
of this act if:
    (1)  The  dealer  has  made to the supplier an
intentional and material misrepresentation  as  to
the dealer's financial status;
    (2)  The  dealer has defaulted under a chattel
mortgage or other security agreement  between  the
dealer and the supplier; or
    (3)  The dealer has filed a voluntary petition
in bankruptcy.
    (b)  Whenever  a  dealer  enters into a dealer
agreement  under  which  the  dealer   agrees   to
maintain  an  inventory  and  the  dealer  or  the
majority stockholder of the dealer, if the  dealer
is a corporation, dies or becomes incompetent, the
supplier, at the  option  of  the  heir,  personal
representative  or  guardian of the dealer, or, if
the dealer is a corporation, at the option of  the
person  who succeeds to the stock of such majority
stockholder,   shall   repurchase   the   dealer's
inventory as if the agreement had been terminated.
Any option to  repurchase  under  this  subsection
shall  be exercised not later than six months from
the date  of  death  of  the  dealer  or  majority
stockholder  or  the  date  on which the dealer or
majority stockholder is lawfully determined to  be
incompetent, whichever is applicable.
    Sec.  4.  (NEW) (a) Not later than ninety days
after receipt of a  dealer's  written  request,  a
supplier  under  a  duty  to  repurchase inventory
pursuant to section 3 of this act and this section
may  examine any books or records of the dealer to
verify the eligibility of any inventory  item  for
repurchase.  Except  as otherwise provided in this
section and section 5 of this  act,  the  supplier
shall  repurchase  from  the dealer all inventory,
required signage, special tools, books,  supplies,
data  processing equipment and software previously
purchased from the  supplier  or  other  qualified
vendor  under  the  dealer  agreement  and  in the
possession  of  the  dealer   on   the   date   of
termination of the dealer agreement.
    (b)  The  supplier  shall  pay the dealer, for
any repurchase of inventory  under  section  3  of
this act and this section, as follows:
    (1)  One  hundred  per cent of the net cost of
all new, undamaged and complete farm  and  utility
tractors,  forestry equipment, light industrial or
construction  equipment,  farm  implements,   farm
machinery  and yard and garden equipment purchased
from the supplier or other qualified vendor  under
the  dealer  agreement  within the past thirty-six
months,   less   a   reasonable   allowance    for
deterioration  attributable  to weather conditions
at the dealer's location;
    (2)  Ninety per cent of the current net prices
of all new and undamaged repair parts;
    (3)  Eighty-five  per  cent of the current net
price of all new and undamaged  superseded  repair
parts;
    (4)   Eighty-five   per  cent  of  the  latest
available published  net  price  of  all  new  and
undamaged noncurrent repair parts;
    (5)  The  fair  market  value  of any specific
data  processing  hardware   that   the   supplier
required the dealer to acquire in order to satisfy
the  reasonable   requirements   of   the   dealer
agreement,  including  computer  systems equipment
required  and  approved   by   the   supplier   to
communicate   with  the  supplier,  provided,  the
supplier may assume the dealer's  responsibilities
under  any  lease of such hardware or equipment in
lieu of such payment;
    (6)  Seventy-five  per cent of the net cost of
specialized  repair  tools,  signage,  books   and
supplies purchased pursuant to the requirements of
the supplier under the dealer agreement  and  held
by the dealer on the date of termination, provided
any such specialized repair tools shall be  unique
to  the  supplier's  product  line  and  shall  be
complete and in usable condition; and
    (7)  The  average as is value shown in current
industry guides for any dealer-owned rental  fleet
financed by the supplier or any finance subsidiary
of the supplier.
    (c)  The  party that initiates the termination
of a dealer agreement under section 2 of this  act
shall  pay  the  cost  of  the  return,  handling,
packing and loading of all  inventory  repurchased
under section 3 of this act and this section.
    (d)  Payment required to be made to the dealer
under this section shall be made by  the  supplier
not  later  than  forty-five days after receipt of
the inventory by the supplier. A  penalty  may  be
assessed by the dealer against the supplier in the
amount of two per cent per day on any  outstanding
balance existing after such forty-five-day period.
The supplier may apply any payment required to  be
made to the dealer under this section as a set-off
against any amount  owed  by  the  dealer  to  the
supplier.
    Sec.  5.  (NEW)  The  provisions of sections 3
and 4 of this act shall not require the repurchase
from a dealer of:
    (1)  A repair part with a limited storage life
or otherwise subject  to  physical  or  structural
deterioration   including,  but  not  limited  to,
gaskets or batteries;
    (2)  A  single repair part normally priced and
sold in a set of two or more items;
    (3)   A  repair  part  that,  because  of  its
condition,  cannot  be  marketed  as  a  new  part
without   repackaging  or  reconditioning  by  the
supplier or a manufacturer;
    (4)  Any  inventory  that the dealer elects to
retain;
    (5)  Any inventory ordered by the dealer after
receipt of notice of  termination  of  the  dealer
agreement by either the dealer or the supplier; or
    (6)  Any  inventory  that  was acquired by the
dealer from a source other than  the  supplier  or
other qualified vendor under the dealer agreement.
    Sec.  6.  (NEW)  (a)  Except  as  provided  in
subsection (b) of this section, no supplier  shall
unreasonably  withhold  or  delay  consent  to any
transfer of a dealer's business or transfer of the
stock  or other interest in a dealer whenever such
consent is required pursuant to a dealer agreement
and the proposed transferee meets the material and
reasonable business and financial requirements  of
the  supplier.  If  the supplier determines that a
proposed   transferee   does   not    meet    such
requirements,  the  supplier shall give the dealer
written notice stating the  specific  reasons  for
withholding  consent  not  later  than ninety days
after  the  date  of  the  dealer's  request   for
consent.   No  such  proposed  transferee  may  be
disqualified by the supplier from being  a  dealer
solely   because  the  proposed  transferee  is  a
publicly held corporation.
    (b)  No  supplier  shall unreasonably withhold
or delay consent to any  transfer  of  a  dealer's
business  to  a member or members of the family of
the dealer or the principal owner of the dealer if
(1)  such consent is required pursuant to a dealer
agreement,  (2)  such  family  member  meets   the
reasonable business qualifications, experience and
character standards of the supplier, and (3)  such
family  member  demonstrates  to the supplier that
such business will  be  or  will  continue  to  be
adequately capitalized. If the supplier determines
that any such family member  does  not  meet  such
requirements,  the  supplier shall give the dealer
written notice stating the  specific  reasons  for
withholding  consent  not  later  than ninety days
after  the  date  of  the  dealer's  request   for
consent.  As  used  in  this  subsection, "family"
means  the  spouse,  parent,  siblings,  children,
stepchildren  and  lineal  descendants,  including
those by adoption,  of  the  dealer  or  principal
owner of the dealer.
    (c)  In  any  dispute as to whether a supplier
has  unreasonably  withheld  consent  under   this
section,  the  supplier  shall  have the burden of
proving a substantial and reasonable justification
for such withholding of consent.
    Sec.  7.  (NEW)  Whenever  a  supplier  and  a
dealer enter into a dealer agreement that provides
for  consumer  warranties,  the supplier shall pay
any warranty claim made for parts and service  not
later  than thirty days after receipt and approval
of such claim by the supplier. The supplier  shall
approve  or  disapprove a warranty claim not later
than thirty days after receipt of  such  claim  by
the   supplier.   If   a  warranty  claim  is  not
disapproved in writing by the thirtieth day  after
receipt of such claim by the supplier, it shall be
deemed to be approved and payment shall be made by
the   supplier   not   later   than   thirty  days
thereafter.
    Sec.  8.  (NEW) The obligation of any supplier
or dealer under this act shall be applied  to  and
made an obligation of any successor in interest or
assignee of the supplier or dealer.  For  purposes
of this section, a successor in interest includes,
but is not limited to, any purchaser of the assets
or  stock,  any  surviving entity resulting from a
merger or liquidation, any receiver or any trustee
of the original supplier or dealer.
    Sec.  9.  (NEW)  (a) Nothing in this act shall
be construed to release or terminate  a  perfected
security  interest  of a supplier in the inventory
of a dealer.
    (b)  Nothing in this act shall be construed to
limit the right of a  dealer  and  a  supplier  to
enter  into  a  dealer agreement providing for the
arbitration  of  disputes   arising   under   such
agreement.   Any   such   arbitration   shall   be
consistent with the provisions  of  this  act  and
other  applicable  law. Any such arbitration shall
be conducted in the city  or  town  in  which  the
dealer  maintains  the dealer's principal place of
business in this state.
    (c)   Any  provision  contained  in  a  dealer
agreement or other contract  purporting  to  waive
compliance  with  any  requirement  of this act is
void and  unenforceable  to  the  extent  of  such
purported waiver.
    (d)  Nothing in this act shall be construed to
limit  or  prohibit  good-faith   settlements   of
disputes  voluntarily  entered  into  between  the
parties to a dealer agreement.
    Sec. 10. (NEW)  Any  supplier  or  dealer  may
bring an action  in  the Superior Court to recover
damages sustained by  reason of a violation of any
provision of sections  1  to 9, inclusive, of this
act and, if  appropriate, may apply for injunctive
relief as provided  in  chapter 916 of the general
statutes. Any such action shall be privileged with
respect to its assignment for trial. Such supplier
or dealer, if  successful in such action, shall be
entitled to costs and reasonable attorneys' fees.
    Sec. 11. (NEW)  Any person or any attorney who
represents such person,  who  commences  any civil
action or complaint,  in  his own name or the name
of others, against  the  owner  or  operator  of a
"pick or cut  your own agricultural operation" (1)
without probable cause,  shall  pay  such owner or
operator  double  damages,   including,   in   the
discretion  of the  court,  costs  and  attorney's
fees, or (2)  without  probable  cause, and with a
malicious intent unjustly  to vex and trouble such
owner  or  operator,   shall  pay  such  owner  or
operator   treble  damages   including,   in   the
discretion  of the  court,  costs  and  attorney's
fees. As used  in  this section, "pick or cut your
own agricultural operation"  means  a farm to whom
the Department of  Revenue  Services  has issued a
farmer tax exemption permit under subdivision (63)
of section 12-412  of  the  general statutes, that
allows any person  to  enter  such  farm  for  the
purpose of agricultural  harvesting, including the
cutting  of  Christmas   trees.  Nothing  in  this
section shall be  construed  to affect or abrogate
the provisions of  section  52-568  of the general
statutes.

Approved June 24, 1997